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TAL life insurance payouts hit almost $1 billion a year

New figures show that Australia’s leading life insurance specialist TAL paid out more than $947 million in claims last year, an increase of around 12.5% on the previous year’s payout of $843 million.

Of the different forms of life insurance, those taken out to help people while still living account for the majority of the payments, while a payment in the event of death now accounts for just 47.4% of benefits paid.

Cancer features as the chief reason for claims in 2014 overall, accounting for almost a quarter of all payments, followed by circulatory system diseases, injuries and fractures, and diseases of the respiratory system.

TAL General Manager Claims Mary Maini said the increase in the amount of life insurance payments made to customers in 2014 reflected an industry trend of rising claims in recent times as people become more aware of their life insurance benefits.

“The rising amounts of life insurance payouts being paid to customers is in fact very good news because it highlights the value and need of life insurance in protecting customers and their families when they most need it,” she said.

“Life insurance protects the assets and future dreams of people and families, but there is a practical benefit with close to a billion dollars paid by TAL to its customers last year helping them to get back on their feet, to meet ongoing obligations and even achieve future aspirations.”

Break down of total paid claims benefit for 2014 calendar year for TAL

Type of Claim

Total Amount Paid

% of total paid

Income Protection Insurance and Business Expense Insurance

$275,230,674

29.0

Life Insurance

$449,882,237

47.4

Total and Permanent Disability Insurance

$180,155,795

19.0

Critical Illness Insurance

$43,289,816

4.6

Total

$948,558,522

100.0

Claims by Gender

Nature of claim

% of Total claims

Male

63.4

Female

36.6

Most common claim

Nature of claim

% of Total claims

Cancer

24.1

Diseases of the circulatory system

15.6

Injury & Fractures

13.4

Diseases of the respiratory system

8.0

Musculoskeletal connective tissue diseases

7.7

Mental & behavioural disorders

4.0

Claims by Age at Claim

Nature of claim

% of Total claims

Up to Age 35

12.4

36-45

14.2

46-55

21.9

56-65

23.5

Over 65

28.0

This equates to paying an average of $3.79 million each and every working day (excluding weekends and public holidays) to customers.

Mary said many people did not realise how beneficial financial protection has been for so many people in society, people who otherwise might not have been able to get back on their feet or pick up the pieces to continue with the life they had planned.

“While superannuation and direct insurance has helped expand the reach of life insurance and reduce the social security burden on taxpayers and even other relations and friends, the real question people need to ask themselves is do they have appropriate and adequate levels of life insurance?

“Seeing a financial adviser is a great way to assess a person or family’s insurance needs, because it is vitally important to ensure they have the right amount of life cover in case their income suddenly stops.”

TAL created the video below to help demonstrate just how impactful and beneficial claims payments are across the community, and has producedthis infographicof the 2014 claims figures.

And recent results from TAL’s third annual Financial Protection Index shows people believe they have far less life insurance than they need, with a national protection score of just 31.62 recorded out of 100 (with 100 representing full protection).

TAL is Australia’s largest life insurance company with leading competitive offerings in each of its core distribution channels: direct to customers; through financial advisers; and via group and workplace superannuation schemes. With in-force premiums of $2.2b, TAL provides more life insurance solutions to Australians than any other insurer. TAL is owned by The Dai-ichi Life Insurance Company, Limited, one of the world’s largest life insurers.